Insurtech Updates: Launches, expansions, partnerships and more
Quilt. Fabric. Ladder. Root. Lemonade.
If you know what these words have in common, you’re doing a pretty good job keeping up with newer entrants into the insurance market. Yep, if you’re going to be an insurtech startup these days, it seems you need to have a one-word name with no immediate discernable connection to insurance.
Our latest look at what’s up with some of these potential disruptors provides updates on some new digital life insurance products, accidental death coverage aimed at young parents, a progress report on homeowners/renters insurance carrier Lemonade, and expansion for a “good driver only” mobile-based auto insurer.
They’re frequently partnering with existing carriers, or receiving investments from them. They’re all set on disrupting the traditional process of obtaining insurance, and generally they’ve got their sights set squarely on the mobile-crazy Millennial market.
Lemonade passes 14,000 insured homes, receives investment from Allianz
New York-based Lemonade, the homeowners and renters insurance company “powered by artificial intelligence and behavioral economics,” recently released the latest of its “Transparency Chronicles” and announced a strategic investment by Allianz.
Last December, based on its initial launch results, Lemonade set a target of having 13,000 customers by the end of 2017. “We modeled this based on the rapid growth of our first days in-market. We thought it was aggressive, but doable,” said Lemonade cofounder Shai Wininger in his June 1 Transparency Chronicle update.
As of June 1, Lemonade stood at 14,315 homes insured, beating its target seven months early.
“It’s not only about how many customers we have, but how fast we’re accelerating,” Wininger said. “Our weekly sales of new policies is now 60 times what it was half a year ago. And growing.”
Data in the Transparency Chronicle shows 21.5% of Lemonade’s clients switched from GEICO, 20.5% from State Farm, 17.1% from Allstate, 10.5% from Liberty Mutual, 5% from Progressive and the rest from companies like Farmers, USAA and others.
Wininger said Lemonade hashandled a total of 117 claims so far, paying out $143,190, and 27% of the claims were handled and processed instantly from start to finish by “AI Jim,” Lemonade’s “claims bot.”
“One point that we didn’t feel right about was the difference in the time it took AI Jim to handle a claim (3 seconds) and the time banks took to move money from our account to our members’ (several days). That sucks,” Wininger said. “So we dug deeper and found a better way to send money to our members. Instead of wiring funds the traditional way, we now allow our users to receive claim payments directly to their debit cards, instantly.”
Wininger also announced that Lemonade is now licensed in an additional seven states – Texas, New Jersey, Michigan, Arizona, North Carolina, Virginia and Rhode Island – and will be launching there soon. Those states will join New York, California and Illinois, where Lemonade is already available.
Yet another announcement was the addition of an Earthquake Insurance option for Californians. “It’s the first time we added an insurance carrier as a partner, and integrated it (almost) seamlessly into our flow. Adding earthquake coverage to your policy is really easy, and will become even simpler with a set of improvements we’re pushing soon,” Wininger said. “I love this integration because it shows that we can easily scale the product and our system to work with other insurers and new products, while maintaining control of the customer experience, from buying policies to handling claims.”
Finally, Lemonade recently announced a strategic investment by Allianz, the world's largest insurance company.
"Allianz is committed to staying at the cutting edge of insurance," said Solmaz Altin, Chief Digital Officer at Allianz SE. "We follow the insurtech space closely and globally, and have seen nothing to match Lemonade in terms of technology, user experience and business model innovation. We're thrilled to become a stakeholder in Lemonade, and will do what we can to accelerate their rapid expansion throughout the U.S. and beyond."
"Allianz is rightly regarded as one of the most forward-thinking companies in our industry," said Daniel Schreiber, cofounder and CEO at Lemonade. "Despite their unparalleled reach and resources, Allianz has no competitive business with Lemonade, and we look forward to deepening our relationship with them in the years to come."
Details of the investment have not been disclosed.
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